Page 218 - TSMC 2022 Annual Report

The main source of hedge ineffectiveness in these hedging relationships is driven by the effect of the counterparty’s own credit risk on the fair value of forward contracts. No other sources of ineffectiveness emerged from these hedging relationships during the hedging period. For the years ended December 31, 2022 and 2021, refer to Note 21(d) for gain or loss arising from changes in the fair value of hedging instruments, the amount transferred to initial carrying amount of hedged items and the amount reclassified to finance costs of hedged items.
The following tables summarize the information relating to the hedges of interest rate risks. December 31, 2021
Contract Amount (In Thousands)
Forward interest rate contracts
The effect for the years ended December 31, 2022 and 2021 is detailed below:
Balance in Other Equity (Continuing Hedges)
$ 128,165
Hedging Instruments
Maturity
Hedging Instruments/Hedged Items
Hedging Instruments
Forward exchange contracts (capital expenditures) Forward interest rate contracts (issuance of debts)
Hedged Items
Forecast transaction (capital expenditures) Forecast transaction (issuance of debts)
11. NOTES AND ACCOUNTS RECEIVABLE, NET
At amortized cost
Notes and accounts receivable Less: Loss allowance
At FVTOCI
Change in Value Used for Calculating Hedge Ineffectiveness Years Ended December 31
US$ 328,000
January 2022
2022
- 1,379,119
$
$ (1,379,119)
December 31, 2022
$ 222,761,927 (331,646)
222,430,281 7,325,606
$ 229,755,887
2021
$ (41,416) $ 132,508
$ 41,416 $ (132,508)
December 31, 2021
$ 193,733,220 (347,020)
193,386,200 4,199,909
$ 197,586,109
$ $
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The Company signed a contract with the bank to sell certain accounts receivable without recourse and transaction cost required. These accounts receivable are classified as at FVTOCI because they are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets.
In principle, the payment term granted to customers is due 30 days from the invoice date or 30 days from the end of the month when the invoice is issued. Aside from recognizing impairment loss for credit-impaired accounts receivable, the Company recognizes loss allowance based on the expected credit loss ratio of
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